More consumers say 'soup's on.'
The soup companies are profiting from the new style of eating that has been termed "grazing." Instead of gathering as a family and eating three full meals a day, many people grab a bite here and a bite there. Quick-to-prepare soups appeal to these eaters.
"Soup has always been convenient, but convenience has become even more important in the business today than in the past," says Herb Baum, vice president of marketing for the Campbell Soup Co. of Camden, N.J.
Two types of soup are performing especially well, according to Baum. Single-strength soups, such as Campbell's Chunky Style line, and Oriental-style noodle soups are growing faster than the overall category. According to SAMI, dry soup mixes, condensed soups and even boullion cubes also showed real growth last year, gaining sales at a rate well ahead of inflation.
The increasing popularity of single-serving soups has encouraged manufacturers to produce a wider variety of products aimed at single households and two-income families who purchase the single-serving soups. Younger and more willing to experiment than the population as a whole, this demographic group is more likely to enjoy greater flavor in soup. The single-serving products are usually a bit spicier and more adult in taste than condensed soups.
Baum says Campbell's Chunky Soup line was up in volume by about 10% last year, and that the product sported strong sales gains in the Southeast, Southwest and West. A 19th flavor, New England Clam Chowder, was added.
Other food companies have been even more aggressive than Campbell's during the past year as they worked to capture a share of the expanding soup business, which is still dominated by Campbell's. New flavors in single-strength soups
New York-based American Home Products, which brought out Chef Boy-Ar-Dee Soup di Pasta and Luck's Country Style soups in 1982, began to build its business in the canned soup category last year. Ten new Soup di Pasta flavors were introduced in 1983, along with five new flavors in Luck's Country Style soups.
"Soup di Pasta was a natural extension of our Chef Boy-Ar-Dee line of products," says Jack Wood, public affairs officer for American Home Products. "The Chef Boy-Ar-Dee products have been traditionally oriented toward children, but there was great potential for the line to be extended to adults." Soup di Pasta is now marketed in all regions of the country except the West Coast and Southeast.
As the original marketers of hearty, single-serving soups, Progresso Foods of Rochelle Park, N.J., helped create the soup-as-a-meal concept. The company is not idly standing by while other firms enter its single-serving domain. To complement its traditional escarole, minestrone, chickarina and other Italian styles of soups, Progresso brought out four new flavors--beef vegetable, beef minestrone, chicken vegetable and chicken minestrone--last year. This added product line has given Progresso more shelf space in markets where the brand is a strong seller.
Campbell's still accounts for a reported 80% of the condensed soup market. During the fiscal year that ended July 31, 1983, seven of Campbell's top 10 condensed soups showed sales growth. Campbell's Soup unit increased sales 5% over the previous fiscal year, with case volume up 2%.
"Our advertising program that stresses that 'Soup is good food,' has been very successful," Baum says. "People have always believed that soup is nutritious. Our advertising simply reconfirmed that belief and encouraged consumers to buy more soup."
Campbell's offers 62 varieties of condensed soup, with chicken noodle being the best seller. Baum says broths improved sales at a much greater rate than other condensed soups last year. The vice president of marketing has also been pleased with sales of the Homestyle soups, which are aimed at adults.
"Our Homestyle soups spark the taste buds more than most condensed soups," says Baum. "They have more seasoning and also have short noodles like in dry soups." Campbell's has been so satisfied with sales of the Homestyle soups on the market that they plan to bring out two new flavors in October, the start of the soup season. New packaging on Horizon
On the packaging front, Campbell's has begun testing a plastic bowl type container that Baum describes as a "microwavable soup bowl." In 1983, Campbell management decided that the can was too expensive and too inconvenient in the era of the microwave oven. Millions of dollars are being spent to develop an alternative package. Baum says that the new packaging is still a year or two away as Campbell's attempts to develop a container that will be as recognizable and as appealing as the world-famous Campbell's soup can.
Oriental-style noodle soups continued to gain sales last year, but at a much slower rate than the phenomenal growth they boasted several years ago. At most supers, the Oriented noodle soups have taken permanent residence alongside the single-strength and dry soups. They often supplant the more traditional styles of soup on end displays and mass stackings because they can be bargain-basement priced.
"Our products have both convenience and low price in their favor," says Jim Johns, marketing supervisor for Nissin Foods of Los Angeles, the producers of Cup o' Noodles, Oodles o' Noodles and Top Ramen Oriental noodle soups. "People have accepted Cup o' Noodles as a quick lunch or snack, and have been using the dry noodle lines as the basis for easy-to-prepare meals. Although some people still refuse to try our products, the acceptance of the Oriental-style soups has been fantastic, especially in the West."
The Cup o' Noodles line, which suffered a sales slowdown during the recent recession, has experienced a strong up-turn in sales as people have more money to spend on convenience-oriented products, reports Johns. The chicken flavor is the top seller, followed by beef. Other flavors include shrimp, beef onion and pork.
The Top Ramen line, sold under the brand name Oodles o' Noodles east of the Mississippi River, also boasted excellent sales growth last year despite increasing competition from other firms entering the dry Oriental noodle market. "When you go against drugstores and discounters selling inferior noodle products at six for a dollar, business is difficult. But in the long run, quality products win out," Johns says.
Nissin introduced chicken mushroom flavor Top Ramen about 18 months ago. The new product recently surpassed pork to become the number three flavor behind chicken and beef. In early 1984, Nissin introduced a chili flavor product aimed at the Hispanic population. Sales on this unusual flavor now being test-marketed have been mediocre.